The Tether Gold stablecoin was valued at $1,902 on July 24, putting the price of gold within reach of the commodity’s all-time high set in September 2011.
According to The Wall Street Journal, the commodity set a new record for closing price at $1,897.50 on July 24, but has yet to reach its record intraday high of $1,921 from 2011. Gold has risen 22.7% from $1,550 to $1,902 since Tether Gold (XAUT) — a stablecoin allowing ownership of one troy ounce of gold held in a Swiss vault controlled by the company — was released on Jan. 23.
The surge comes just three days after the U.S. government announced a second stimulus bill to counter the economic impact of the COVID-19 pandemic.
“In times of uncertainty, people like having accessibility to gold,” said Paolo Ardoino, Tether Chief Technology Officer (CTO). He continued:
“The increasing demand for Tether Gold is reflected by an 8.4% increase in its price over the past 30 days, as well as its current market capitalization of over $92 million.”
Bitcoin or gold?
However, for gold bugs like Peter Schiff, traders who invest in Bitcoin are not looking for stability. He said that investors aren’t going to “get rich on gold” — or, consequently, gold-backed stablecoins — but they assume less risk in losing more from volatile crypto prices.
Today Schiff continued to push the idea that “a big drop” in BTC price was inevitable:
Two of the last three times #Bitcoin rose above $10,000 in Oct. of 2019 and in Feb. of 2020 it soon fell by 38% and 63% respectively. The last time Bitcoin rose above $10,000 was in May, and it only fell by 15%. It's above $10,000 again today. How big will the next drop be?— Peter Schiff (@PeterSchiff) July 27, 2020